Are you paying a convenience tax on your home loan?

Let’s face it: finding the best deal on your home loan can be a real headache, whether you’re a first-time buyer or an investor. If you don’t know where to look it’s a time-consuming process with a lot of fine print to wade through. 

So opting to go with a bank or lender that you have an existing relationship with might seem like the easiest way to go. But could the cost of convenience be stopping you from getting a better deal?

According to a recent report by the Australian Securities & Investments Commission (ASIC), 60% of Australian homeowners choose to stay with their existing bank or lender when taking out a home loan. ASIC found that most of the time this decision was influenced by convenience.

Homeowners often cited the fact that their existing bank already had all their financial information as their reason for choosing not to search for a better deal for their home loan. But, the report found that this loyalty was not always rewarded; a number of homeowners were disappointed with their bank’s failure to offer rewards or better deals to existing customers.

Managing Director of loans.com.au Marie Mortimer expressed her surprise that so many Aussies still settle for “an overpriced loan from their existing bank.”

“It shows that many borrowers still don’t understand just how simple it is to get a home loan online and how big the savings really are.”

With sites like Mozo doing the maths for you, these days finding a good home loan isn’t quite as tough as you might imagine. In fact, you can even check out the Mozo home loan repayment calculator to see how you can fit a home loan into your budget. Or if the process is entirely new to you then have a look at Mozo’s handy guides for first-time buyers. 

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“A surprising number of people currently with a big bank can’t even tell you what interest rate they are paying on their home loan let alone how much that adds up to over time,” added Mortimer.

If you want to make sure that convenience isn’t costing you, then make sure you shop around. Whether you’re a first-time borrower or thinking about switching, looking further afield for a home loan with a better deal could save you a lot of dollars in the long run.

Check out some of the deals in the table below. Or head to Mozo’s home loan comparison tool, if you need help comparing home loan deals. The Mozo home loan comparison tool compares over 500 home loans from over 80 lenders. Just enter how much you want to borrow and over what number of years. You can even sort by what’s most important to you, whether it be a low interest rate or a low comparison rate. 

Now that you know where and how to compare deals, you can start searching for your dream home! Happy house-hunting!